SEVERANCE AGREEMENT AND RELEASE
This
Severance Agreement and Release (the "Agreement")
is
entered into as of this 3rd
day of
June, 2008, by and between NeoMedia Technologies, Inc., a Delaware corporation
(the "Company")
and
Xxxxxxx Xxxxxxx (the "Executive").
RECITALS:
WHEREAS,
the
Executive has tendered his resignation with the Board of Directors of the
Company on May 29, 2008, a copy of which is attached hereto as Exhibit
A;
and
WHEREAS,
in
connection with the Executive’s resignation, the Company and the Executive have
agreed to terminate the Employment Agreement by and between them dated June
18,
2007 and any subsequent agreements or modifications of the Employment Agreement
(the "Employment
Agreement")
and
the employment relationship existing thereunder; and
WHEREAS,
both
Executive and the Company desire to resolve any differences and/or disputes
with
respect to Executive's employment and the resignation thereof.
AGREEMENT:
NOW
THEREFORE,
in
consideration of the mutual agreements and covenants set forth herein, and
for
such other good and valuable consideration, the receipt and sufficiency of
which
is hereby acknowledged, the Executive and the Company acknowledge and
voluntarily agree as follows:
1.
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Recitals.
The forgoing recitals are true and correct and are incorporated herein
by
this reference.
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2.
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Termination
of Employment Agreement.
The Executive and the Company shall terminate the Employment Agreement
as
of 5:00 p.m., Eastern Standard Time on May 29, 2008 the (“Effective
Date”).
As of the Effective Date, all rights of the Executive thereof shall
terminate and all terms of the Employment Agreement shall be of no
further
force or effect.
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3.
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Severance
Payment.
In consideration of the termination of the Employment Agreement and
the
other covenants and agreements set forth herein, the Company shall
pay to
the Executive a severance payment equal to One Hundred Eighty-Seven
Thousand Five-Hundred Dollars ($187,500), of which Ninety-Three Thousand
Seven Hundred Fifty Dollars ($93,750) shall be paid by the Company
to the
Executive within five (5) business days from the Effective Date (the
“Initial
Payment”)
and the remainder shall be paid to the Executive in four (4) equal
monthly
installments of Twenty-Three Thousand Four Hundred Thirty-Seven Dollars
and Fifty Cents ($23,437.50) commencing on November 1, 2008 in accordance
with the Company's customary payroll practices. The parties agree
and
acknowledge that the Executive shall receive the Initial Payment
as a
1099.
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4.
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Benefits.
The Executive shall be entitled to continue to participate in or
receive
health, welfare, life insurance, long-term disability insurance and
similar benefits as the Company provides generally from time to time
to
its senior executives, and to its employees, generally, through and
until
the earlier of (a) the last day of the month in which the final
installment payment is paid in accordance with Section 3 herein above
(the
“Expiration
Date”)
and (b) such date that the Executive obtains employment and becomes
eligible for benefits of such employer. Nothing herein is intended,
or
shall be construed to require the Company to institute or continue
any, or
any particular, plan or benefits. Furthermore, the Executive hereby
agrees
and acknowledges that he shall be obligated to make all monetary
contributions in accordance with each applicable benefit plan for
so long
as he continues to participate in such
plans.
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5.
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Options.
In consideration of the termination of the Employment Agreement and
the
other covenants and agreements set forth herein, the Executive shall
be
granted by the Company on the Effective Date an option to purchase
Ten
Million (10,000,000) shares of the Company’s common stock, par value $0.01
per share, at $0.01 per share (the “Options”)
which all such Options shall vest and become exercisable as of the
Effective Date through the Expiration Date.
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6.
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No
Additional Payments.
The Executive and the Company agree that except as provided in Sections
3,
4 and 5 herein above, the Executive is not entitled to any additional
salary, benefits, compensation or other consideration of any nature
whatsoever.
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7.
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Release
by Executive.
Except with respect to the (i) covenants and agreements of the Company
set
forth in this Agreement, the Executive, on behalf of himself, his
successors, heirs and assigns, hereby agrees to completely and irrevocably
discharge and release the Company, its officers, directors, employees,
agents, shareholders, affiliate corporations or entities, predecessors,
successors and assigns, and their officers, directors, employees,
agents
and shareholders from any and all claims, demands, actions, damages,
lawsuits, obligations, promises, administrative actions, charges
and
causes of action, and/or liability whatsoever, both known or unknown,
in
law or in equity, involving any matter arising out of or in any way
related, directly or indirectly, to any and all obligations, duties
and
liabilities under the Employment Agreement and the termination of
same,
including, but not limited to, any claim of wrongful discharge, breach
of
contract, and/or employment discrimination in violation arising out
of,
under, or in relation to the Executive’s employment with the Company, the
termination of the Employment Agreement, the Civil Rights Act of
1871, the
Labor Management Relations Act of 1947, the Equal Pay Act of 1963,
Title
VII of the Civil Rights Act of 1964, the Occupational Safety and
Health
Act of 1970, the Rehabilitation Act of 1973, the Health Maintenance
Organization Act of 1973, the Employee Retirement Income Security
Act of
1974, the Immigration Reform and Control Act of 1986, the Civil Rights
Act
of 1991, Executive Orders 11141, 11246 and 11375 and/or any other
state,
federal or local Fair Employment Practice law, employment law, or
statute.
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2
8. |
Release
by Company.
The Company, for itself and its directors, officers, employees, agents,
subsidiaries and affiliated entities, remises, releases, and forever
discharges Executive, his heirs, executors, and administrators,
successors, assigns, agents, counsel and representatives, of and
from all
manner of action and actions, cause and causes of action, suits,
debts,
sums of money, covenants, contracts, agreements, claims and demands
whatsoever, in law, or in equity, that Company ever had, now has
or may
have, for, on, or by reason of any matter, cause, or thing whatsoever,
that may have arisen by reason of Executive's employment or affiliation
with the Company.
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9. |
Non-Competition.
Commencing on the Effective Date through and until the Expiration
Date,
the Executive shall not, in the Restricted Area (as defined below),
directly or indirectly, engage in, promote, finance, own, operate,
develop, sell or manage or assist in or carry on in any business
with
those companies set forth on Exhibit
B
attached hereto; provided,
however,
that Executive
may at any time own securities of any business set forth on Exhibit
B
attached hereto whose securities are publicly traded on a recognized
exchange so long as the aggregate holdings of the Executive in any
one
such company shall constitute not more than five percent (5%) of
the
voting stock of such company. The phrase “directly
or indirectly”
used in this Agreement includes the Executive either on his own account,
or as a partner, owner, promoter, joint venturer, employee, agent,
consultant, advisor, manager, executive, independent contractor,
officer,
director, stockholder, or otherwise, of an
entity.
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10. |
Non-Solicitation
of Employees or Independent Contractors.
Commencing on the Effective Date through and until the Expiration
Date,
the Executive shall not, directly or indirectly, solicit or attempt
to
induce any employee of the Company or independent contractor engaged
and/or utilized by the Company in any capacity to terminate his employment
with, or engagement by, the Company. Likewise, commencing on the
Effective
Date through and until the Expiration Date, the Executive shall not,
directly or indirectly, hire or attempt to hire for another entity
or
person any employee of the Company or independent contractor engaged
and/or utilized by the Company in any
capacity.
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11. |
Non-Solicitation
of Customers, Prospective Customers or Vendors.
Commencing on the Effective Date through and until the Expiration
Date,
the Executive shall not, directly or indirectly, sell, assemble,
manufacture or distribute products or services of the type sold or
distributed by the Company to any Customer, Prospective Customer
or Vendor
(as such terms are defined below) of the Company in the Restricted
Area
through any entity other than the Company. The Executive acknowledges
and
agrees that the Company has substantial relationships with its Customers
and Vendors, which the Company expends significant time and resources
in
acquiring and maintaining, and that the Company’s relationships with its
Customers and Vendors constitute a significant and valuable asset
of the
Company. The term “Customer”
means any person or entity which has purchased goods, products or
services
from the Company, entered into any contract for products or services
with
the Company, and/or entered into any contract for the distribution
of any
products or services with the Company within the one (1) year immediately
preceding the Effective Date. The term “Prospective
Customer”
means any person or entity which has purchased goods, products or
services
from the Company, entered into any contract for products or services
with
the Company, and/or entered into any contract for the distribution
of any
products or services with the Company within the one (1) year immediately
preceding the Effective Date. The term “Vendor”
means any supplier, person or entity from which the Company has purchased
products or services during the one (1) year immediately preceding
the
Effective Date.
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3
12. |
Acknowledgment
by Executive.
The term “Company”
for purposes of Sections 9, 10 and 11 of this Agreement means NeoMedia
Technologies, Inc., a Delaware corporation and its affiliated and
related
entities, including, without limitation, all of NeoMedia Technologies,
Inc.’s subsidiaries and joint venturers. It is understood that any
affiliated or related entities of NeoMedia Technologies, Inc. are
intended
third-party beneficiaries of such provisions of this Agreement.
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13. |
Acknowledgement
by Company.
The Company hereby agrees and acknowledges that the Executive’s
obligations under Sections 9, 10 and 11 hereunder are expressly contingent
upon the Company’s full and timely compliance with its obligations to make
all payments required hereunder and to provide all benefits as provided
under the terms of this Agreement. In the event that the Company
breaches
its obligations under this Agreement, the Executive shall deliver
to the
Company written notice of said breach. If after thirty (30) days
of the
Company’s receipt of such written notice from the Executive the Company
shall not have cured such breach, the Executive shall be relieved
of his
obligations under Sections 9, 10 and
11.
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14. |
Confidentiality.
Each party hereto hereby covenants and agrees that this Agreement
and its
terms and conditions are, collectively and individually, totally
confidential, and that from the date of this Agreement forward shall
forever be kept totally confidential and shall not in any manner
or for
any reason be disclosed by both parties without the express written
consent of both parties except (a) to each party’s attorneys, accountants,
and family members on a "need to know" basis, all of whom shall be
informed of and be bound by the provisions of this Section; (b) as
may be
required by law and by government agencies, such as the Internal
Revenue
Service and the U.S. Securities and Exchange Commission; and (c)
pursuant
to court order or subpoena compelling such disclosure. Should either
party
receive any such subpoena or court order compelling disclosure, such
party
shall immediately notify the other party so that it may have the
opportunity to interpose an objection. The provisions of this Section
shall not apply in any action brought by a party against the other
party
to enforce any provisions of this
Agreement.
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15. |
Non-Disparagement.
The Executive shall refrain from making any written or oral statement
or
taking any action, directly or indirectly, which he knows or reasonably
should know to be a disparaging or negative comment concerning the
Company
or its officers, directors, employees and agents with the intent
to injure
or damage the Company or its officers, directors, employees and agents,
and shall refrain from suggesting that any such disparaging or negative
comment concerning the Company or its officers, directors, employees,
attorneys and agents be made except as may be compelled by a court
of
competent jurisdiction. The Company shall refrain from making any
written
or oral statement or taking any action, directly or indirectly, which
it
knows or reasonably should know to be a disparaging or negative comment
concerning the Executive with the intent to injure or damage the
Executive, and shall refrain from suggesting that any such disparaging
or
negative comment concerning the Executive be made except as may be
compelled by a court of competent jurisdiction.
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16. |
Return
of Property.
On or before the Effective Date, the Executive will return to the
Company
any and all documents, lists, data, confidential information, trade
secrets, keys, equipment, products or other property in his possession
which relate in any manner to the Company; provided, however, that
the
Executive shall be entitled to retain possession and ownership of
his cell
phone and computer.
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17. |
Opportunity
to Hire Counsel; Amendments.
The Executive and Company each represent and warrant that they have
had
the opportunity to review and consider the terms of this Agreement
with
their respective legal counsel (the costs of such counsel having
been, and
continuing to be, borne exclusively by the Company with respect to
Company’s legal counsel, and by Executive with respect to Executive’s
counsel), and that neither of them have made any representations
concerning the terms or effects of this Agreement other than those
contained in this Agreement, it being clearly understood that this
Agreement are the only agreements between the parties and they may
not be
modified or terminated orally, but only in a writing signed by both
of
them.
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18. |
Injunctive
Relief.
The Executive and Company each acknowledge that the other’s breach of the
terms of this Agreement would make difficult the assessment of monetary
damages that would be sustained from such breach, and it would be
difficult, if not impossible, to compensate fully for damages for
any such
breach, specifically including, but not limited to, breach of the
provisions relating to confidentiality, non-competition, non-disparagement
and issuance of the Options. Accordingly, each party specifically
agrees
that the other shall be entitled to temporary and permanent injunctive
relief and/or specific performance to enforce this Agreement or to
enjoin
any unauthorized disclosure of confidential information, and the
Party in
breach shall expressly waive the defense that a remedy in damages
would be
adequate and any requirement for the security or posting of any bond
in
connection with any such injunctive relief. This provision with respect
to
injunctive relief and/or specific performance shall not, however,
diminish
the right of the non-breaching party to claim and recover damages
in
addition to or in lieu of injunctive relief and/or specific
performance.
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19. |
Binding
Agreement.
All of the terms and provisions of this Agreement shall be binding
upon,
inure to the benefit of, and be enforceable by the parties and their
respective legal representatives, successors and permitted assigns,
whether so expressed or not.
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5
20. |
Counterpart
Signatures.
This Agreement may be executed in one (1) or more counterparts, each
of
which shall be deemed an original, but all of which taken together
shall
constitute one and the same instrument. Confirmation of execution
by
electronic transmission of a facsimile signature page shall be binding
upon any party so confirming.
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21. |
Attorney
Fees.
If any legal proceeding is brought for the enforcement of this Agreement,
or because of an alleged dispute, breach or threatened breach, default
or
misrepresentation in connection with any provision of this Agreement,
the
successful or prevailing party shall be entitled to recover reasonable
attorneys’ fees, sales and use taxes, court costs and all expenses even if
not taxable as court costs (including, without limitation, all such
fees,
taxes, costs and expenses incident to arbitration, appellate, bankruptcy
and post-judgment proceedings), incurred in that legal proceeding,
in
addition to any other relief to which such party may be entitled.
Attorneys’ fees shall include, without limitation, paralegal fees,
investigative fees, administrative costs, sales and use taxes and
all
other charges billed by the attorney to the prevailing party.
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22. |
23. |
Severability.
If any provision of this Agreement is invalidated by a court of competent
jurisdiction, then all of the remaining provisions of this Agreement
shall
remain in full force and effect, provided that both parties may still
effectively realize the complete benefit of the promises and
considerations conferred hereby.
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[Remainder
of Page Intentionally Left Blank]
6
IN
WITNESS WHEREOF,
the
parties have executed this Severance Agreement and Release on the date set
forth
above.
/s/
Xxxxxxx Xxxxxxx
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XXXXXXX
XXXXXXX
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NEOMEDIA
TECHNOLOGIES, INC., a
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Delaware
corporation
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By:
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/s/
Xxxx XxXxxxxx
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Name:
Xxxx XxXxxxxx
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Title:
Chief Executive Officer
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7
EXHIBIT
B
ScandBuy
3GVision
Mobiletag
Beetag
ShotCode
8